Under the leadership of Prime Minister Narendra Modi, and Finance Minister Nirmala Sitharaman, our government is working to simplify India’s tax system. Due emphasis has been given towards the reduction of financial burden on our citizens, creating a positive regulatory environment that will boost ease of doing business, and attracting foreign direct investments into the country.

The Next Generation Goods and Services Tax (GST) reforms are a part of the tax reform process, which has also seen the introduction of a new Income Tax Act (2025).

The focus of these reforms is on three major areas – clarity, efficiency, and ease of use. Putting more money in the hands of individuals and families, making the entire taxation process transparent, removing archaic and ambiguous terms, improvement in tax filing and collection processes, ease of use for the citizens and businesses, and ensuring the removal of “red tapism" have been some of the hallmarks of these reforms.

On Independence Day 2025, PM Modi had announced major reforms in the GST regime, which is effective from today, September 22, 2025.

The new ‘Simple Tax’ structure reduces tax rates from existing five slabs to three slabs, eliminating the 12% and 28% slabs altogether:

With these rates, the nil/exempt categories have been expanded substantially, including for daily essentials, consumer electronics, life-saving items, insurance, agricultural inputs, automobiles and other related sectors.

For the overall economy, this is a game-changer. Lower taxes on household goods will put more money in the pockets of our citizens, and supercharge domestic consumption. Increased liquidity will drive demand across sectors,........

© News18